'Finance Minister' Manmohan Singh's call for steps to revive the "animal spirits in the country's economy" is providing hope that the government may start acting with a sense of urgency.

A report in the Times of India says that Cabinet Secretary Ajit Seth has already called a meeting of secretaries of key economic ministries today.

The meeting will discuss ways to ensure a pick-up in growth, including a possible stimulus, the report said citing a senior government official.

There are also suggestions to revive capital expenditure and investment. AFP

The meeting will take up the proposals made by industry chambers Ficci and CII.

"Industry chambers Ficci and CII have proposed that the government provide enhanced depreciation rate of 25% that will encourage manufacturers to step up capacity addition and replace old machinery," the report said.

There are also suggestions to revive capital expenditure and investment.

For the government, however, any decision to provide sops to industry is not going to be a cake walk, as it will have to keep in mind the ever-widening fiscal and current account deficits.

The reforms will have to be kicked off with a increase in prices of diesel, if not decontrolling its altogether. This will help the government narrow its fuel subsidy burden to a large extent. With the international crude oil prices falling, it is the right time for the government to act on fuel prices.

And the pressure on the the government to devise ways to prop the rupee is all the more heavier, given the announcements by the Reserve Bank of India turned out to be a damp squib.

"Pranab Mukherjee inflated the market's hopes that he'd take bold measures to boost investor confidence, but came up with a few small tweaks - on his last day as finance minister," a Reuters Breakingviews column said.

The government has to devise measures that will attract long-term foreign direct investments, not foreign investor inflows that are short term in nature.

The Prime Minister's comments have come at an opportune time. Over the last one week, there have been two multinational companies which have evinced interest in investing in India - Ikea and Coca-Cola.

The comments from Manmohan Singh give an indication that the government has the issue on its mind.

"On the external front, I am concerned about the way the exchange rate is going. Investor sentiment is down and capital flows are drying up," the prime minister has been quoted as saying to the finance ministry officials.

Sounds serious. But when will he act is the question.

Reports are already indicating that any action on diesel price is likely only after the presidential polls. So the wait is likely to get longer. Keep the fingers crossed.